Ineos, the privately owned petrochemical and oil & gas company run by Britain’s richest man Sir Jim Ratcliffe, went on a spending spree in early 2019 that saw the business dramatically increase its public profile almost overnight with some unexpected purchases.
Ineos future challenges
After a record year in 2017, which saw the business post $7 billion in profit and $60 billion in turnover, the early results for the financial year 2018 were also looking healthy, suggesting the company had plenty of spare cash to invest. Ineos CEO and chairman Sir Jim Ratcliffe was quoted as saying: “$7 billion in profit is a lot of money to spend, even for us.”
However, it has not all been smooth sailing for the company since then.
Ratcliffe, an outspoken supporter of Brexit, announced in February that he and his key Ineos lieutenants would be domiciled in Monaco for tax purposes. This announcement came only a month after Ratcliffe was knighted for services to business and investment in the UK, prompting a media scandal.
Also, Ineos expressed an interest in fracking for shale gas on a number of sites where it has rights, again prompting criticism from groups opposed to the controversial method of hydraulic fracturing.
As a result, Ineos is spending heavily to both open up new revenue opportunities, but also to improve its public image.
2019 spending spree
Ineos announced in January that it would build the first new chemical manufacturing plant in Europe in many decades. The gas cracker unit will be built in Antwerp and is expected to cost EU3 billion ($3.4 billion).
Team SKY, the six-time winners of the Tour de France were snapped up in 2019 by Ineos, after SKY decided to step back from the venture. Ineos is currently planning to increase the team’s budget from its already unparalleled level of £35 million ($46 million) up to £40 million ($53 million) per year.
Projekt Grenadier, which represents Ineos’s off-road vehicle manufacturing plans, would see Ratcliffe’s automotive team produce a 4×4 comparable with Jaguar Land Rover’s Defender. The budget has been stated to be £600 million ($790 million) for the first phase of the project and may yet be built in Britain.
Ineos is the new principal sponsor for Britain’s America’s Cup sailing team led by Ben Ainslie, the company managed to secure the deal under the nose of the previous sponsor Jaguar Land Rover. The deal is worth $153 million.
In 2017, Ineos purchased the small Swiss football team of Lausanne Sport, with an eye to using this club to prepare it for a much bigger purchase of a top-flight football team. In mid-March 2019 there were rumours linking Ineos and Sir Jim Ratcliffe with the purchase of Chelsea FC, the Blues.